Bellapu Kanaka Durga, Vijayawada V. Deputy Commissioner of Income Tax, Circle-2(1), , Vijayawada

CO 72/VIZ/2018

• Counselvise Citation: [2019] 116 COUNSELVISE.COM (IT) 8449 (ITAT-VISAKHAPATNAM)
• Duration Of Justice: 10 month(s) 19 day(s)
• Appeal Type: Cross Objection
• Pronouncement Date: 17-07-2019
• Appeal Filed By: Assessee
• Order Result: Dismissed
• Bench Allotted: DB
• Assessment Year: misc
• Appeal Filed On: 28-08-2018
• Result in Favour of: Revenue
• Court: TRIBUNAL
• Department Lawyers: D K SONAWAL
• Assessee Lawyers: C SUBRAHMANYAMFC A
• Keywords: TDS; Set aside

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL VISAKHAPATNAM BENCH, VISAKHAPATNAM BEFORE SHRI V. DURGA RAO , HONBLE JUDICIAL MEMBER & SHRI D.S. SUNDER SINGH , HONBLE ACCOUNTANT MEMBER ITA NO. 240 / VIZ /201 8 (ASST. YEAR: 20 13 - 14) DCIT, CIRCLE - 2(1), VIJAYAWADA. V S . SMT. BELLAPU KANAKA DURGA, D.NO. 60 - 17 - 4, NEAR SUNNAPUBATTI CENTRE, NAVODAYA COLONY, VIJAYAWADA. PAN NO. ANXPB 8404 H (APPELLANT) (RESPONDENT) C.O.NO. 72/VIZ/2018 (ARISING OUT OF ITA NO. 240 / VIZ /201 8) (ASST. YEAR : 20 13 - 14) SMT. BELLAPU KANAKA DURGA, D.NO. 60 - 17 - 4, NEAR SUNNAPUBATTI CENTRE, NAVODAYA COLONY, VIJAYAWADA. VS. DCIT, CIRCLE - 2(1), VIJAYAWADA. PAN NO. ANXPB 8404 H (APPELLANT) (RESPONDENT) ASSESSEE BY : SHRI C. SUBRAHMANYAM,FC A. DEPARTMENT BY : SHRI D.K. SONAWAL CIT DR DATE OF HEARING : 04 / 0 7 /201 9 . DATE OF PRONOUNCEMENT : 17 / 0 7 /201 9 . 2 ITA NO. 240/VIZ/2018 C.O.NO. 72/VIZ/2018 ( SMT. BELLAPU KANAKA DURGA ) O R D E R PER D.S. SUNDER SINGH , ACCOUNTANT MEMBER TH IS APPEAL BY THE REVENUE AND THE CROSS OBJECTION BY THE ASSESSEE ARE DIRECTED AGAINST THE ORDER OF COMMISSIONER OF INCOME TAX (APPEALS) , VIJAYAWADA , DATED 12 /0 3 /201 8 FOR THE ASSESSMENT YEAR 20 13 - 14 . 2. THE REVENUE HAS RAISED THE FOLLOWING GROUNDS OF APPEAL: - 1. THE ORDER OF THE LD. CIT(A) IS ERRONEOUS BOTH IN FACTS AND IN LAW. 2. THE CIT(A) ERRED IN ACCEPTING THE ASSESSEE'S CONTENTION THAT THE ADVANCE RECEIVED WAS RETURNED TO THE CONTRACTEE I.E., M/S.VARSITY EDUCATIONAL MANAGEMENT PRIVATE LTD., EXCLUDING THE TDS AMOUNT, WITHOUT APPRECIATING THE FACT THAT ADVANCING SUCH A HUGE AMOUNT WITHOUT EXECUTING ANY WORK AND REPAYMENT OF ADVANCE WITHOUT ANY INTEREST IS NOT A PRUDENT BUSINESS PRACTICE. 3. THE LD.CIT(A) OUGHT TO HAVE APPRECIATED THE FACT THAT WHEN THE ASSESSEE CLAIMED FOR CREDIT FOR TDS MADE BY THE CONTRACTEE AND THE SAME WAS ALLOWED, THE CORRESPONDING RECEIPTS ARE CHARGEABLE TO TAX AS PER THE PROVISIONS OF SEC. 199 OF THE I.T.ACT. 4. ALTERNATIVELY, THE LD.CIT(A) OUGHT TO HAVE HELD THAT THE DIFFERENCE AMOUNT RETAINED WI TH THE ASSESSEE WITHOUT RETURNING TO THE CONTRACTOR WOULD BE TREATED AS INCOME OF THE ASSESSEE UNDER THE HEAD 'INCOME FROM OTHER SOURCES'. 5 ANY OTHER GROUND THAT MAY BE URGED AT THE TIME OF APPEAL HEARING. 3 . ALL GROUNDS OF APPEAL ARE RA LA TED TO THE ADDITION MADE BY THE ASSESSING OFFICER (AO) AMOUNTING TO RS. 6,40,70,427/ - WHICH WAS PARTLY CONFIRMED BY THE LD. CIT(A). 4 . FACTS OF THE CASE, IN BRIEF, ARE THAT THE ASSESSEE IS IN THE BUSINESS OF CONTRACT WORKS BY SUPPLY OF LABOUR . FOR THE YEAR 3 ITA NO. 240/VIZ/2018 C.O.NO. 72/VIZ/2018 ( SMT. BELLAPU KANAKA DURGA ) UNDER CONSIDERATION, THE ASSESSEE FILED HER RETURN OF INCOME DECLARING TOTAL INCOME OF RS. 71,84,370/ - ON 15/11/2013 . THE CASE WAS SELECTED FOR SCRUTINY AND IN THE COURSE OF ASSESSMENT PROCEEDINGS, THE ASSESSING OFFICER HAS OBSERVED THAT THE ASSESSEE HAS ADMITTED THE GROSS CONTRACT RECEIPTS OF RS. 34,89,17,821/ - AND ADMITTED NET PROFIT OF RS. 72,07,097/ - AND FILED RETURN OF INCOM E DECLARING TOTAL INCOME OF RS. 71,84,370/ - . THE ASSESSEE ALSO CLAIMED THE REFUND OF RS. 2 2 ,64,370/ - . DURING THE SCRUTINY ASSESSMENT PROCEEDINGS, THE ASSESSING OFFICER CALLED FOR THE CONTRACT AGREEMENTS AND ON PERUSAL OF THE AGREEMENTS, HE FOUND THAT THE ASSESSEE HAD ENTERED INTO THE AGREEMENT S TO EXECUTE THE WORKS OF RS.41,29,88,248/ - , OUT OF WHICH ONE OF THE CONCERN WAS M/S. VARSITY EDUCATION MANAGEMENT PVT. LTD., HYDERABAD (IN SHORT, COMPANY) . T HOUGH AS PER THE CONTRACT AGREEMENTS THE VALUE OF THE GROSS RECEIPTS WORKED OUT TO RS . 41,29,88,248/ - , AS PER FORM 26AS , THE GROSS REC E IPTS WERE ONLY RS. 41,01,43,176/ - AND IN THE PROFIT & LOSS ACCOUNT THE ASSESSEE HAD ADMITTED THE GROSS RECEIPTS OF RS. 34,89,17,821/ - . THUS, THE AO FOUND SHORT ADMISSION OF GROSS RECEIPTS TO THE TUNE OF RS. 6,4 0 , 7 0, 427 / - ( RS.41,29,88,248 RS. 34,89,17,821) . SINCE THERE WAS DIFFERENCE IN GROSS CONTRACT S AS PER CONTRACT AGREEMENTS , AS PER FORM 26AS AND THE PROFIT & LOSS ACCOUNT, THE ASSESSING OFFICER CALLED FOR 4 ITA NO. 240/VIZ/2018 C.O.NO. 72/VIZ/2018 ( SMT. BELLAPU KANAKA DURGA ) EXPLANATION OF THE ASSESSEE TO EXPLAIN THE DIFFERENCE . IN RESPON SE TO THIS, THE ASSESSEE SUBMITTED THAT M/S. VARSITY EDUCATION MANAGEMENT PVT. LTD. (COMPANY) HAS PAID THE ADVANCE OF RS. 6,13,67,900/ - AND THE SAME WAS RETURNED DUE TO CANCELLATION OF THE AGREEMENT. THE ASSESSEE FURTHER STATED THAT M/S. VARSITY EDUCATION MANAGEMENT PVT. LTD. DEDUCTED TAX AT SOURCE ON THE ADVANCE AMOUNT, HENCE , THERE WAS A DIFFERENCE IN FORM 26AS AND THE RECEIPTS AS PER THE BO OKS . IN SUPPORT OF HIS SUBMISSION , THE ASSESSEE FILED CONFIRMATION LETTER FROM M/S. SRI VARSITY EDUCATION MANAGEMENT PVT. LTD. , WHEREIN IT WAS STATED THAT DUE TO CANCELLATION OF THE AGREEMENT WITH THE ASSESSEE, THE ASSESSEE HAD RETURNED THE AMOUNT OF RS. 6,07,86,000/ - AFTER MAKING THE TDS. THE DETAILS OF PAYMENT OF RS. 6,13,67,900/ - DURING THE PERIOD 02/08/2012 TO 18/09/2012 TOWARDS ADVANCE TO THE ASSESSEE FOR SERVICES TO BE RENDERED ARE AS UNDER: - S.NO. DATE OF ADVANCE PAYMENT AMOUNT IN RS. 1. 02/08/2012 1,85,92,000 2. 02/08/2012 64,35,000 3. 03/09/2012 2,97,00,000 4. 18/09/2012 66,40,000 TOTAL 6,13,67,900 4.1 EXCEPT CONFIRMATION LETTER, THE ASSESSEE HAS NOT SUBMITTED ANY EVIDENCE TO SUPPORT THAT THE ASSESSEE HAS NOT REN DERED THE SERVICES TO THE COMPANY AS PER THE AGREEMENT DURING THE INTERVENING PERIOD. AS PER THE W O RK ORDER, T HE COMPANY HAS TO 5 ITA NO. 240/VIZ/2018 C.O.NO. 72/VIZ/2018 ( SMT. BELLAPU KANAKA DURGA ) PAY THE AMOUNTS TO THE ASSESSEE AS PER THE WORK DONE BY THE ASSESSEE . THE MAINTENANCE OF HOSTELS AND COLLEGE CAMPUS IS A CONTI NUOUS WORK WHICH WAS REQUIRED TO BE EXECUTED BY THE ASSESSEE TO THE COMPANY . THEREFORE, THE ASSESSING OFFICER DID NOT BELIEVE THE UNILATERAL CANCELLATION OF AGREEMENT IN THE ABSENCE OF ANY EVIDENCE, HENCE, MADE THE ADDITION OF RS. 6,40,70,427/ - REPRESENTING THE DIFFEREN CE BETWEEN THE RECEIPTS TO BE RECEIVED AS PER THE CONTRACT AGREEMENT AND THE RECEIPTS ADMITTED AS PER THE PROFIT & LOSS ACCOUNT . THE RECEIPTS AS PER THE CONTRACT AGREEMENT WORKED OUT TO RS. 41,29 ,88,248/ - WHEREAS THE CONTRACT RECEIPTS ADMITTED BY THE ASSESSEE WAS RS. 34,89,17,821/ - , WHICH RESULTED IN DIFFERENCE OF RS. 6,40,70,427/ - AND THE SAME WAS ADDED BY THE ASSESSING OFFICER IN THE ASSESSMENT . 5. AGGRIEVED BY THE ORDER OF THE ASSESSING OFFICER, THE ASSESSEE W ENT ON APPEAL BEFORE THE CIT(A). BEFORE THE LD. CIT(A), THE ASSESSEE FILED RECONCILIATION OF CONTRACT RECEIPTS . THE LD. CIT(A) HA D OBSERVED THAT M/S. VARSITY EDUCATION MANAGEMENT PVT. LTD. HAS CONFIRMED THE REFUND OF ADVANCE GIVEN TO THE ASSESSEE AND F ROM THE BANK ACCOUNT , IT WAS SEEN THAT A SUM OF RS. 6,07,86,000/ - WAS DEBITED TO THE ASSESSEE ACCOUNT TOWARDS THE PAYMENT MADE TO M/S. VARSITY EDUCATION MANAGEMENT PVT. LTD., HYDERABAD . THE LD.CIT(A) FURTHER OBSERVED THAT T HE ASSESSING 6 ITA NO. 240/VIZ/2018 C.O.NO. 72/VIZ/2018 ( SMT. BELLAPU KANAKA DURGA ) OFFICER DID NOT DISPUTE THE FACT THAT THE AMOUNT OF RS. 6,07,86,000/ - WAS REFUND ED BY THE ASSESSEE . THE TOTAL ADVANCE GIVEN BY THE COMPANY TO THE ASSESSEE WAS RS. 6,13,67,900/ - , OUT OF WHICH THE ASSESSEE HA D REFUNDED THE SUM OF RS. 6,07,86,000/ - AND THE AMOUNT OF RS. 5,81,900/ - WAS REMAINED WITH THE ASSESSEE. THE COMPANY HAS DEDUCTED TDS OF RS. 6,14,00 0 / - ON THE ADVANCE OF RS.6,13,67,900/ - WHICH WAS CLAIMED BY THE ASSESSEE AS CREDIT IN HER RETURN OF INCOME. HENCE, LD. CIT(A) CONFIRMED THE HIGHER AMOUNT OF BALANCE RETAINED O R THE TDS RETAINED BY THE ASSESSEE FROM THE AMOUNT OF ADVANCE . ACCORDINGLY, CONFIRMED THE ADDITION OF RS. 6,14,000/ - RELATING TO THE ADVANCE RECEIVED FROM M/S. SRI VARSITY EDUCATION MANAGEMENT PVT. LTD. AND ACCORDINGLY ALLOWED THE APPEAL OF THE ASSESSEE PARTLY. 6 . AGAINST THE ORDER OF THE LD. CIT(A) , THE REVENUE IS IN APPEAL BEFORE THIS TRIBUNAL. 7 . DURING THE APPEAL HEARING, THE L D.DR SUBMITTED THAT M/S. VARSITY EDUCATION MANAGEMENT PVT. LTD. HAS GIVEN THE ADVANCE TO THE ASSESSEE , FOR RENDERING THE SERVICES AS PER THE WORK ORDER GIVEN TO THE ASSESSEE AND MADE THE PAYMENT S PERIODICALLY FROM 02/08/2012 TO 18/09/2012 , WHICH WAS SUPPOSED TO BE RELEASED ON THE PROGRESS OF THE WORK. THE AMOUNTS WERE 7 ITA NO. 240/VIZ/2018 C.O.NO. 72/VIZ/2018 ( SMT. BELLAPU KANAKA DURGA ) REFUNDED TO THE COMPANY ON 2 5 /0 2 /20 13 I.E. AFTER THE LAPSE OF SEVEN MONTHS FROM THE DATE OF PAYMENT AND AFTER 10 MONTHS FROM THE WORK ORDER COME INTO FORCE . THE ASSESSEE ALSO SPENT THE AMOUNT WITHOUT KEEPING THE ADVANCE INTACT. THEREFORE, IT IS UNBELIEVABLE ACCEPT THE CONTENTION OF THE ASSESS EE THAT HAVING UTILIZED THE FUNDS, THE ASSESSEE DID NOT DO THE WORK AS PER WORK ORDER . THE ASSESSEE SIMPLY SUBMITTED CONFIRMATION LETTER WITHOUT FURNISHING ANY EVIDENCE TO PROVE THAT THE AMOUNT WAS RECEIVED ONLY AS AN ADVANCE BUT NOT FOR THE WORK DONE . THEREFORE, LD.DR ARGUED THAT IT IS CLEAR FROM THE CONDUCT OF ACCOUNT THAT THE ASSESSEE HAD RECEIVED THE AMOUNT FOR THE CONTRACT WORK DONE TO M/S. VARSITY EDUCATION MANAGEMENT PVT. LTD. , AS PER THE WORK ORDER AND REFUND OF THE AMOUNT AT A LATER DATE I .E. 25/02/2012 IS NOTHING BUT MAKE BELIEVE ARRANGEMENT . THEREFORE, ARGUED THAT THE AMOUNTS RECEIVED BY THE ASSESSEE REPRESENT THE REVENUE RECEIPTS IN THE HANDS OF THE ASSESSEE AND REQUIRED TO BE TAXED AS INCOME . H ENCE, SUBMITTED THAT THE ASSESSING OFFICER RIGHTLY MADE THE ADDITION AND REQUESTED TO SET ASIDE THE ORDER OF THE LD. CIT(A) AND CONFIRM THE ENTIRE ADDITION. 8 . ON THE OTHER HAND, LD. AR SUBMITTED TH A T THE ASSESSEE HA D RECEIVED AN AMOUNT OF RS. 6.13 CRORES FROM THE COMPANY , HOWEVER , THE AGREEMENT WAS CANCELLED DUE TO DIFFERENCES AND THE 8 ITA NO. 240/VIZ/2018 C.O.NO. 72/VIZ/2018 ( SMT. BELLAPU KANAKA DURGA ) ASSESSEE HAD TO REFUND THE ENTIRE AMOUNT, ACCORDINGLY THE ASSESSEE HAD REFUNDED THE AMOUNT THROUGH RTGS WHICH IS EVIDENCE BY THE BANK ACCOUNT. THE ASSESSEE ALSO FURNISHED C OPY OF BANK ACCOUNT REFLECTING THE REPAYMENT OF RS. 6.07 CRORES THROUGH RTGS ON 25/02/2013 THROUGH AXIS BANK . AT PAGE NO.5 OF THE PAPER BOOK THE ASSESSEE ENCLOSED THE COPY OF LETTER ISSUED BY M/S. VARSITY EDUCATION MANAGEMENT PVT. LTD. , CONFIRMING THE CANCELLATION OF THE AGREEMENT AND RECEIPT OF THE SUM OF RS. 6.07 CRORES, THEREFORE, ARGUED TH A T THE ASSESSEE DID NOT RENDER ANY SERVICE AND DUE TO CANCELLATION OF THE AGREEMENT, THE ASSESSEE HAS TO REFUND THE ENTIRE AMOUNT, HENCE, REQUESTED TO THE DELETE THE ADDITION MADE BY THE ASSESSING OFFICER AND UPHOLD THE ORDER OF THE LD. CIT(A). 9. WE HAVE HEARD BOTH THE P ARTIES AND PERUSED THE MATERIAL PLACED ON RECORD. 10 . IN THE INSTANT CASE , THE ASSESSEE HAD ENTERED INTO AGREEMENT FOR EXECUTION OF WORK ORDER WITH M/S. VARSITY EDUCATION MANAGEMENT PVT. LTD. , FOR RENDERING VARIOUS SERVICES SUCH AS TRANSPORTATION OF LABOUR SERVICES , COOKING FOOD SERVICES, CLEARING LABOUR SERVICES ETC. A S PER THE DETAILED LIST FURNISHED IN THE AGREEMENT. THE ASSESSEE HAS TO RENDER THE SERVICE BY VIRTUE OF WORK ORDER GIVEN TO HER DATED 01/04/2012 WHICH WAS ALSO 9 ITA NO. 240/VIZ/2018 C.O.NO. 72/VIZ/2018 ( SMT. BELLAPU KANAKA DURGA ) EFFECTIVE FROM 01/04/2012. ACCORDING TO THE AGREEMENT, M/S . VARSITY EDUCATION MANAGEMENT PVT. LTD., ( COMPANY ) PAID AN AMOUNT OF RS. 6,13,67,900/ - ON VARIOUS DATES FROM 02/08/2012 TO 18/09/2012. AFTER A LAPSE OF SEVEN MONTHS FROM THE DATE OF RECEIPT, THE AS SESSEE RETURNED THE SUM OF RS. 6,07,86,000 / - STATING THAT THE AGREEMENT WAS CANCELLED, HENCE DID NOT ADMIT THE SAME AS INCOME . THE DIFFERENCE AMOUNT OF RS. 6,14,000/ - REPRESENTING TDS DEDUCTED BY THE COMPANY WAS CONFIRMED BY THE LD. CIT(A) AND DIRECTED THE ASSESSING OFFICER TO TAX THE SAME IN THE HANDS OF THE ASSESSEE. IN THE INSTANT CASE, THE ASSESSEE HAD ENTERED INTO AGREEMENT WITH M/S. VARSITY EDUCATION MANAGEMENT PVT. LTD., HYDERABAD BY WORK ORDER DATED 01/04/2012 . AS PER THE AGREEMENT, WORK ORDER COMES INTO FORCE ON 01/04/2012 FOR RENDERING VARIOUS SERVICES . AS PER THE TERMS OF WORK ORDER THE CONTRACTOR SHALL BE PAID FEE SET OUT IN ANNEXURE - 1 B , 2 B & 3 B IN ACCORDANCE WITH THE PAYMENT ARRANGEMENT S SET OUT IN ANNEXURE - 1 B , 2 B & 3B OF THE WORK ORDER BASED ON THE QUANTUM OF WORK AND EXECUTION OF WORK . SIMILARLY CLAUSE NO. 4.1 OF THE WORK ORDER THE COMPANY SHALL REIMBURSE ALL THE REASONABLE EXPENSES INCURRED FOR TRAVELLING, HOTEL BILLS AND OTHER OUT OF POCKET EXPENSES WITHIN 15 DAYS F ROM THE CLAIM . FOR THE SAKE OF CONVENIENCE AND CLARITY , WE 10 ITA NO. 240/VIZ/2018 C.O.NO. 72/VIZ/2018 ( SMT. BELLAPU KANAKA DURGA ) EXTRACT THE CLAUSES 4 & 4.1 OF THE W ORK ORDER WHICH IS MADE AVAILABLE IN THE PAPER BOOK AT PAGE NO. 8 AS UNDER: - 4.0 THE CONTRACTOR SHALL BE PAID THE FEE SET OUT IN ANNEXURE - 1B, 2B & 3B IN ACCORDANCE WITH THE PAYMENT ARRANGEMENTS SET OUT IN ANNEXURE - 1B , 2B & 3B BASED ON THE QUANTUM OF WORK AND EXECUTION OF WORK. 4.1 SUBJECT TO THE ARRANGEMENTS SET OUT IN ANNEXURE - 1B, 2B & 3B , THE CONTRACTOR SHALL BE REIMBURSED ALL REASONABLE TRAVELLING, HOTEL BILLS AND OTHER OUT OF POCKET EXPENSES INCURRED BY THE FIRM OF THE CONTRACTOR FOR EXPEDITED AND PROPER PERFORMANCE OF THE SERVICES TO THE COMPANY PROVIDED THE APPROPRIATE BILLS ARE SUBMITTED WITHIN 15 DAYS. 1 0.1 . THE TERMS OF TERMINATION OF CONTRACT IS AVAILABLE IN CLAUSE 9 OF THE CONTRACT AS UNDER: - 9.0 NOTWITHSTANDING CLAUSE 2, THE COMPANY SHALL BE ENTITLED TO WITHDRAW THIS WORK ORDER WITH IMMEDIATE EFFECT AND WITHOUT ANY COMPENSATION OR DAMAGES DUE TO THE CONTRACTOR, BUT WITHOUT PREJUDICE TO ANY OTHER RIGHTS OR REMEDIES THE COMPANY MAY HAVE, IF THE CONTRACTOR: I. COMMITS A SERIOUS BREACH OF THE TERMS OF THIS WORK ORDER WHICH THE CONTRACTOR FAILS TO RECTIFY WITHIN 14 DAYS OF RECEIPT OF WRITTEN NOTICE FROM THE COMPANY, SPECIFYING THE BREACH AND REQUESTING SPECIFIC REMEDY; II. PERSISTENTLY NEGLECTS, FAILS OR REFUSES TO PERFORM TO THE SATISFACTION OF THE COMPANY THE SERVICES WHICH ARE TO BE PROVIDED UNDER THIS WORK ORDER; III. BECOMES UNFIT TO PERFORM THE SERVICES UNDER THIS WORK ORDER OR IS INCAPABLE OF PERFORMING THEM ADEQUATELY FOR A CONSECUTIVE PERIOD OF ONE MONTH; IV HAS A RECEIVING ORDER MADE AGAINST HIM OR THEIR PROPERTIES, OR MAKES ANY ARRANGEMENT WITH HIS CREDITORS. 10.2 . AS PER CLAUSE 2 OF THE WORK ORDER , IT IS DEEMED TO BE COMMENCE D ON 01/04/2012 AND SHALL CONTINUE UNTIL 30/06/2012, INITIALLY FOR A PERIOD OF 3 MONTHS AND RENEWABLE WITH MUTUAL CONSENT FOR FURTHER PERIOD OR PERIODS. ANNEXURE - 1A IS RELATING TO 11 ITA NO. 240/VIZ/2018 C.O.NO. 72/VIZ/2018 ( SMT. BELLAPU KANAKA DURGA ) TRANSPORT LABOUR SERVICES , ANNEUXRE - 1B IS RELATING TO TRANSPORT LABOUR SERVICE CHARGES . AS PER ANNEXURE - 1B , THE TRANSPORT CHARGES FOR TRANSPORTATION OF SERVICES IS RS. 35,06,413/ - PER MONTH FROM APRIL 2012 AND MAY 2012 AND RS. 7,53,230/ - FOR JUNE 2012. SIMILARLY, ANNEXURE - 2B REL A TED TO THE COOKING FOOD PREPARATION LABOUR CHARGES WHICH IS PAYABLE AT RS. 1,33,04,138/ - PER MONTH FOR APRIL 2012 AND MAY 2012 AND RS. 1,68,70,005/ - FOR JUNE 2 012 . AS PER ANNEXURE - 3B , CLEANING LABOUR CHARGES ARE PAYABLE AT RS. 81,16,400/ - EACH FOR APRIL 2012 AND MAY 2 - 012 AND RS. 1,22,27,634/ - FOR JUNE 2012. THUS, IT IS EVIDENT FROM THE WORK ORDER THAT THE PAYMENTS ARE REQUIRED TO BE MADE BY THE COMPANY TO THE ASSESSEE DEPENDING ON THE QUANTUM OF WORK AFTER RENDERING THE SERVICES ONLY . T HE ASSESSEE IS OBLIGED TO RECEIVE THE PAYMENTS FOR THE WORK DONE . THERE IS NO CLAUSE FOR ADVANCE PAYMENT IN THE WORK ORDER . EVEN IT IS PRESUMED THAT THE ASSESSEE HAD EXECUTED THE WORK OR D ER FOR FIRST THREE MONTHS I.E. FROM APRIL TO JUNE, THE AMOUNT RECEIVABLE FR OM THE COMPANY WORKED OUT TO RS. 7,97,04,771/ - . AS PER THE WORK ORDER IT IS VALID FOR THREE MONTHS INITIALLY FROM APRIL 2012 TO JUNE 2012 . SINCE THE ASSESSEE WAS PAID A SUM OF RS. 6,13,67,900/ - IN AUGUST AND SEPTEMBER, 2012 , IT IMPLIES THAT THE AMOUNT WAS RECEIVED CONSEQUENT TO RENDERING THE SERVICES AND NOT THE ADVANCE PAYMENT. H OWEVER, 12 ITA NO. 240/VIZ/2018 C.O.NO. 72/VIZ/2018 ( SMT. BELLAPU KANAKA DURGA ) THE ASSESSING OFFICER DID NOT VERIFY THE WORK ORDER GIVEN BY THE COMPANY TO ASCERTAIN THE FACTUAL POSITION . THE ASSESSEE ALSO DID NOT KEEP THE AMOUNT IDLE AND SPENT THE SAME, WHICH SHOWS THAT THE ASSESSEE SPENT THE AMOUNT FOR THE WORK DONE. THE ASSESSING OFFICER DID NOT EXAMINE M/S . VARSITY EDUCATION MANAGEMENT PVT. LTD., AND THE WORKS CARRIED ON TO THE COMPANY DURING THE PERIOD OF OPERATION OF THE WORK ORDER. NEITHER THE ASSESSING OFFICER NOR LD.AR PLACED THE CANCELLATION AGREEMENT , DATE OF CANCELLATION, REASONS FOR CANCELLATION, IF THE WORK WAS NOT EXECUTED BY THE ASSESSEE WHO HAS EXECUTED THE WORK TO VARSITY EDUCATION DURING THE PERIOD OF APRIL 2012 TO FEBRUARY 2013 I.E TILL THE DATE OF REPAYMENT OF THE ADVANCE ETC. THE ASSESSEE ALSO DID NOT PLACE ANY CORRESPONDENCE WITH REGARD TO CANCELLATION OF THE WORK ORDER . ALL THESE ISSUES REQUIRED TO EXAMINE IN DETAIL TO ASCERTAIN THE FACTUAL POSITION TO ARRIVE AT THE LOGICAL CONCLUSION TO ASCERTAIN WHETHER THE PAYMENT RECEI VED FROM M/S VARSITY EDUCATION W A S INCOME OR ONLY THE ADVANCE AMOUNT. DURING THE APPEAL HEARING ALSO THE LD.A.R DID NOT FURNISH THE DETAILS SUCH AS THE DATE OF CANCELLATION, REASONS FOR CANCELLATION, WHETHER WORK ORDER HAS BEEN EXECUTED TILL THE DATE OF CANCELLATION, THE CHARGES RECEIVED , THE COMPENSATION PAYABLE IN CASE OF UNILATERAL CANCELLATION ETC . THEREFORE, WE ARE OF THE CONSIDERED VIEW THAT THE ISSUE IS REQUIRED 13 ITA NO. 240/VIZ/2018 C.O.NO. 72/VIZ/2018 ( SMT. BELLAPU KANAKA DURGA ) THOROUGH EXAMINATION WITH THE BOOKS OF ACCOUNT OF THE ASSESSEE AS WELL AS THE COMPANY . THEREFORE, WE REM I T THE MATTER BACK TO THE FILE OF THE ASSESSING OFFICER WITH A DIRECTION TO RE - EXAMINE THE ISSUE IN DETAIL AND DECIDE THE ISSUE AFRESH ON MERITS. HENCE THE ISSUE IS SET ASIDE FOR DENOVO CONSIDERATION . THE ASSESSEE IS DIRECTED TO FURNISH THE REQUIRED INFORMATION FOR COMPLETION OF ASSESSMENT AND IT IS NEEDLESS TO SAY THAT THE ASSESSING OFFICER MUST GIVE REASONABLE OPPORTUNITY TO THE ASSESSEE. SINCE WE REM IT THE MATTER BACK TO THE FILE OF THE ASSESSING OFFICER, WE CONSIDER IT IS NOT NECESSARY TO ADJUDICATE THE GROUND NOS. 3 & 4 . THUS, TH E APPEAL FILED BY THE REVENUE IS ALLOWED FOR STATISTICAL PURPOSE. 13 . SO FAR AS CROSS OBJECTION FILED BY THE ASSESSEE IS CONCERNED, IT IS FILLED WITH DELAY OF 17 DAYS AND NO PETITION IS FILED FOR CONDONATION OF DELAY. HENCE WE DISMISS THE CO IN LIMINE . 14 . IN THE RESULT, APPEAL FILED BY THE REVENUE IS ALLOWED FOR STATISTICAL PURPOSE AND THE C RO SS OBJECTION FILED BY THE ASSESSEE IS DISMISSED. ORDER PRONOUNCED IN OPEN COURT ON TH IS 1 7 T H DAY OF JU LY , 201 9 . S D / - S D / - (V. DURGA RAO) ( D.S. SUNDER SINGH ) JUDICIAL MEMBER ACCOUNTANT MEMBER DATED : 1 7 T H JU LY , 201 9 . 14 ITA NO. 240/VIZ/2018 C.O.NO. 72/VIZ/2018 ( SMT. BELLAPU KANAKA DURGA ) VR/ - COPY TO: 1. THE ASSESSEE - SMT. BELLAPU KANAKA DURGA, D.NO. 60 - 17 - 4, NEAR SUNNAPUBATTI CENTRE, NAVODAYA COLONY, VIJAYAWADA. 2. THE REVENUE DCIT, CIRCLE - 2(1), VIJAYAWADA. 3. THE PR. CIT , VIJAYAWADA. 4. THE CIT(A) , VIJAYAWADA. 5. THE D.R . , VISAKHAPATNAM. 6. GUARD FILE. BY ORDER (VUKKEM RAMBABU) SR. PRIVATE SECRETARY, ITAT, VISAKHAPATNAM.